February 09, 2015 Judgment Delivered On : February 2

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IN THE HIGH COURT OF DELHI AT NEW DELHI
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Judgment Reserved On : February 09, 2015
Judgment Delivered On : February 27, 2015
LPA 454/2014
UNIVERSITY OF DELHI
Represented by:
.....Petitioner
Mr.Santosh Kumar, Advocate with
Ms.Rashmi B.Singh, Advocate
versus
RAM SHEKHAR JHA & ANR.
.....Respondents
Represented by: Mr.Rajiv Aggarwal, Advocate with
Mr.Sachin Kumar, Advocate for
R-1
Mr.Shoaib Haider, Advocate for
R-2
LPA 455/2014
UNIVERSITY OF DELHI
Represented by:
.....Petitioner
Mr.Santosh Kumar, Advocate with
Ms.Rashmi B.Singh, Advocate
versus
RAM SHEKHAR JHA & ANR.
.....Respondents
Represented by: Mr.Rajiv Aggarwal, Advocate with
Mr.Sachin Kumar, Advocate for
R-1
Mr.Shoaib Haider, Advocate for
R-2
CORAM:
HON'BLE MR. JUSTICE PRADEEP NANDRAJOG
HON'BLE MS. JUSTICE PRATIBHA RANI
PRADEEP NANDRAJOG, J.
1.
The brief factual backdrop leading to the filing of the two
captioned intra-court appeals is that the respondent No. 1 : Ram Shekhar
Jha was employed as a casual daily wager (Mali) by the Sports Council
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of the University of Delhi on July 13, 1981. He used to be paid wages by
recording work done as and when assigned as a Mali in the Muster Roll,
meaning thereby his wages were fluctuating each month depending upon
the number of days work was made available to him. Employment was
discontinued on January 11, 1986.
2.
Ram Shekhar Jha raised an industrial dispute alleging that Section
25F of the ID Act, 1947 was violated and for which assertion of the legal
wrong done to him he pleaded that in the last calendar year, reckoned
from January, 1985 till January, 1986, he had served for more than 240
days. He also put another string to his bow by pleading that the principle
of ‘last-come, first-go’ enshrined in Section 25G of the ID Act, 1947 was
also breached, inasmuch as persons taken in as daily wagers after him
were retained in service and work was being taken from them. The
appellant-university denied the assertions. The matter proceeded to the
Labour Court II when the appropriate Government made a reference of
the dispute as under:“Whether the services of Shri Ram Shekar Jha have been
terminated illegally and/or unjustifiably by the management
and if so, to what relief is he entitled and what directions are
necessary in this respect?”
3.
The reference was registered as ID No.481/1986 by the Labour
Court II. Ram Shekhar Jha filed a statement of claim pleading that he
had rendered service for more than 240 days in the preceding calendar
year reckoned from the date when his employment was discontinued as
also that the principle of ‘last-come first-go’ was violated because
persons taken as daily wagers after him were being given work. The
appellant rebutted the pleadings in the statement of claim and on the basis
of the pleadings before it, the Labour Court settled three issues which
read as follows:LPA Nos.454/2014 & 455/2014
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“1) Whether the reference is bad in law in view of
preliminary objection taken in the WS?
2)
Whether the present dispute is not an Industrial Dispute
in view of S.2 (A) of the Industrial Disputes Act?
3)
4.
As in terms of reference.”
Vide award dated September 17, 1991, the Labour Court held in
favour of Ram Shekhar Jha, giving the opinion on the three issues settled
as under:(i)
As regards the first issue it was held that the employer has a
special status and whether a legal entity or not, if he is an employer, he
can sue and be sued in regard to the statutory provisions under the Act.
Reliance was placed by the Labour Court on the decision reported as
(1975) 2 LLJ 265 Management of Cuttak – Motor Association Vs.
Administrative Staff of Cuttack Motor Association & Ors. The Labour
Court held that whether Delhi University Sports Council has a legal
status or entity or not was irrelevant. It was concluded that since Ram
Shekhar Jha was employed by the Delhi University Sports Council, the
reference was maintainable. To put it pithily, the Sport Council was
nothing but the alter ego of the university.
(ii)
As regards the second issue, placing reliance upon the decision
reported as AIR 1964 SC 1272 Buckingham & Carnatic Co Vs.
Venkatiah. , it was held that Ram Shekhar Jha had no intention to
abandon the job. Since his services had been illegally terminated, the
provisions of Section 2(A) of the Act are applicable.
(iii)
As regards the third issue the Tribunal held, as a matter of fact, that
the evidence establishes Ram Shekhar Jha having worked for more than
240 days as a Mali in the preceding calendar year and further that persons
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inducted after him as daily wager were retained in service. Holding that
the termination was in violation of Section 25(F) as also Section 25(G) of
the ID Act, it was held that Ram Shekhar Jha was retrenched in violation
of law.
5.
Directing Ram Shekhar Jha to be reinstated in service the award
proceeded to direct that Ram Shekhar Jha would be entitled to receive
full back wages for the period interregnum when his services were
dispensed with i.e. January 11, 1986 till he was reinstated in service and
further that he would be entitled to the benefit of continuity in service for
said period.
6.
Aggrieved by the award dated September 17, 1991, the appellant
filed WP(C) No.562/1992 in this Court praying that the award be
quashed. Interim stay of the award was prayed for. On February 27,
1992 the learned Single Judge of this Court passed an order directing
that the writ petition be listed after Ram Shekhar Jha was reinstated in
service and accordingly the appellant reinstated Ram Shekhar Jha in
service on March 12, 1992, but in the same capacity in which he had
served till when his services were discontinued i.e. as a daily wager.
Pursuant to the order dated March 12, 1992, Ram Shekhar Jha rejoined
service on March 16, 1992.
7.
The writ petition was admitted and needless to state no order was
required to be passed under Section 17(B) of the ID Act, 1947 because
Ram Shekhar Jha was reinstated in service, albeit as a daily wager : the
status of his employment when employer-employee relationship was
severed.
8.
Due to docket explosion in the record room of this Court, W.P.(C)
No.562/1992 did not mature for hearing keeping in view its priority
position.
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9.
Another significant milestone event took place. Ram Shekhar Jha
learnt that the appellant had a policy to regularize the services of daily
wage employees by confirming them against sanctioned posts as and
when they fell due on superannuation, death or voluntary abandonment
of the post by the incumbent thereof and/or when new posts were
sanctioned. Ram Shekhar Jha further learnt that persons junior to him as
daily wagers were regularized in service on August 01, 1986. He raised
another industrial dispute which was referred by the Appropriate
Government for adjudication to the Industrial Tribunal No.1,
Karkardooma, Delhi with the term of reference being as under:“Whether Shri Ram Shekar Jha is entitled to be regularized in
the proper pay scale from the date of his initial appointment
and if so, to what directions are necessary in this respect?”
10.
The reference was registered by Industrial Tribunal No.1 as ID
No.224/1996. Vide award dated July 03, 2002, the Industrial Tribunal
held that evidence established that persons inducted as daily wagers after
Ram Shekhar Jha were regularized and made permanent on August 01,
1986 and thus it was held that even Ram Shekhar Jha would be entitled to
be regularized in service under the appellant with salary in the regular
scale of pay.
11.
The learned Presiding Officer of the Industrial Tribunal took note
of the fact that Ram Shekhar Jha had been reinstated in service on March
16, 1992 and that W.P.(C) No.562/1992 filed by the appellant
challenging the award dated September 17, 1991 was pending. The
Industrial Tribunal consciously therefore held that it was not passing any
direction for back wages in the regular scale of pay for the period January
11, 1986 till when Ram Shekhar Jha joined back service on March 16,
1992.
Holding, that the entitlement thereto would depend upon the
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outcome of the decision yet to be pronounced in W.P.(C) No.562/1992.
For the remainder period Ram Shekhar Jha was entitled to wages as per
scale applicable to permanent employees.
12.
The award dated July 03, 2002 was neither challenged by the
appellant nor it was implemented, in that, Ram Shekhar Jha was
continued in employment as a daily wager and was being paid wages
computing the number of days work was assigned to him. Therefore
Ram Shekhar Jha filed a writ petition which was registered as WP(C)
No.2793/2003 in this Court praying for the implementation of the award
dated July 03, 2002 and seeking a restraint order against the appellantuniversity from employing other candidates against permanent vacancies
before regularizing his service.
13.
The two writ petitions : W.P.(C) No.562/1992 filed by the
appellant laying a challenge to the award dated September 17, 1991 and
W.P.(C) No.2793/2003 filed by Ram Shekhar Jha praying for
implementation of the award dated July 03, 2002 were consolidated and
heard together.
14.
Vide impugned judgment and order dated January 31, 2014, the
learned Single Judge noted that the award dated July 03, 2002 had not
been challenged by the University and further that the University had
passed an order on January 07, 2005 regularizing the service of Ram
Shekhar Jha with effect from August 01, 1986. The learned Single Judge
further took note of the fact that the order dated January 07, 2005 was
without any condition. Affirming the findings of fact recorded in the two
awards, the learned Single Judge held that Ram Shekhar Jha would be
entitled to salary as a regular employee with effect from August 01, 1986,
denying back wages from January 11, 1986 i.e. the date when Ram
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Shekhar Jha’s service was terminated till July 31, 1986 (for the apparent
reason with effect from August 01, 1986 Ram Shekhar Jha was held
entitled to his service being regularized as per the award dated July 03,
2002 which was not challenged by the University of Delhi.
15.
The appellant has challenged the decision dated January 31, 2014
by filing the two captioned appeals.
16.
From the cornucopia of facts noted by us it is clear that giving
effect to the interim order dated February 27, 1992 passed by this Court,
an order was passed by the appellant on March 12, 1992 reinstating Ram
Shekhar Jha in service, albeit as a daily wager, and he resumed duties on
March 16, 1992 and continued to work but receive salary as a daily
wager till when the University passed the order on January 27, 2005
making him permanent. Post said period Ram Shekhar Jha has been paid
salary due to a permanent employee. Thus, there is no scope for any
debate as to what emoluments should be paid by the appellant to Ram
Shekhar Jha post March 16, 1992, for the reason the appellant has not
challenged the award dated July 03, 2002. If Ram Shekhar Jha has
worked for the University post March 16, 1992, the question of he
working anywhere else and earning a wage does not arise. Since as per
the award dated July 03, 2002, which has not been challenged by the
University, Ram Shekhar Jha was entitled to regularization in service
with effect from August 01, 1986, Ram Shekhar Jha has to receive salary
in the scale of a permanent employee for said period i.e. March 16, 1992
onward.
17.
The question would be concerning the period January 11, 1986 till
the period March 16, 1992, but we truncate this period by reckoning it
from July 31, 1986, because even Ram Shekhar Jha has not challenged
the award dated July 03, 2002, and as noted above in the award the
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Industrial Tribunal has withheld back wages to be paid in the regular pay
scale, or for that matter even as a daily wager from January 11, 1986 till
July 31, 1986.
18.
Thus, the period with which we are concerned would be July 31,
1986 till March 16, 1992.
19.
On the issue of grant of back wages when termination was found to
be contrary to law, in the decision reported as (1979) 2 SCC 80
Hindustan Tin Works Private Limited v/s Employees of Hindustan Tin
Works Private Limited it was observed that there cannot be a strait-jacket
formula for the grant of back wages. Full back wages would be the
normal rule and the party objecting to it must establish the circumstances
necessitating departure. More or less, it depends upon the discretion of
the Court/Tribunal keeping in mind the relevant considerations. Such
discretion must be exercised in judicial and judicious manner for cogent
and convincing reasons and not arbitrarily.
20.
These relevant considerations to be kept in mind while exercising
the discretion to pay or deny back wages were highlighted by this Court
in the decision reported as 2014 (3) SCT 581 (Delhi) Govt. of NCT of
Delhi & Ors. Vs. Mithilesh Swami: where it was held as under:“14. The discretion to pay or deny back wages has to be on the
following principles:(i) Where the termination or disengagement is found to be
tainted with mala fides i.e. it is found that the employer used the
power to dismiss/disengage the services as a camouflage, full
back wages need to be paid for the reason the employer was not
litigating bona fide.
(ii) As a corollary to the first, if the employee bona fide
exercises power to terminate the services of the employee or
disengage the employee from service, upon a procedural or a
technical defect being found in the decision making process or
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it being opined that the weight of the evidence did not justify
services being terminated, back wages may be denied in full or
in part. The reason would be that the employer had acted bona
fide and on the subject of weight of evidence or a default in
procedure there is always a possibility of two equally
reasonable persons taking diametrically opposite views.
(iii) With respect to point No.(ii) above, denial of full or part
back wages has to be with reference to:(a) Length of previous service rendered.
(b) Likelihood of the employee finding alternative employment.
(c) Reason for the delay in adjudication.
15. With respect to points (a), (b) and (c), the logic would be
that where a person has served for say 2 to 3 years, it would be
unjust to burden the employer with full back wages inasmuch as
the employer should not be made to suffer due to docket
explosions in judicial Fora and courts. Further, presumably
such an employee would be young in age and in today's
environment of 'catch them young' there would be a greater
chance for such an employee to be finding alternative
employment in the interregnum. Further, on the likelihood of
the employee finding alternative employment, the nature of the
job performed would be relevant, for the reason for some kind
of skilled/semi-skilled jobs it is easy to find alternative
employment and qua some it is difficult. For example it is easy
for a person with driving skills to drive a light motor vehicle to
find a job, but not so for a person who drives a heavy duty
vehicle. The reason is the number of passenger cars vis-a-vis
heavy duty vehicles on the roads in India would be in the ratio
100:1. On the subject of delay in adjudication, if it is found that
the employer unnecessarily dragged on the proceedings by
seeking adjournment, said circumstance has to be weighed
against the employer and vice versa.
16. We highlight that aforesaid facts and circumstances are
illustrative and not exhaustive. But one thing is clear, the
decision to deny back wages has not to be a mechanical
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exercise or at the whims and fancies of the decision maker.
Every relevant fact and circumstance, for and against the
employer and the employee have to be taken into account.”
21.
Facts of the present case reveal that Ram Shekhar Jha was first
employed as a daily wager on July 13, 1981 and he worked for 4 years
and 6 months as a daily wager when his services were terminated on
January 11, 1986. It was not that there was no work. Persons junior to
him were retained. The principle of ‘last-come first-go’ was breached
assuming the University had to retrench extra hands. The fact that with
effect from August 01, 1986 daily wagers engaged in service after Ram
Shekhar Jha was employed as a daily wager were regularized in service it
can safely be inferred that the process of consideration of regularization
was in contemplation and thus we find malice in terminating service of
Ram Shekhar Jha. It was obviously to give benefit to a person junior to
him.
22.
Under the circumstances the view taken by the learned Single
Judge stands the scrutiny of law. It is trite that an appeal is on a principle
of law and not against the discretion exercised by the learned Single
Judge.
Of course, if it can be shown that the discretion has been
exercised on a wrong principle of law, corrective action can be taken.
23.
The instant appeals do not attract the latter use of power by the
Appellate Court.
24.
The appeals are dismissed but without any order as to costs.
(PRADEEP NANDRAJOG)
JUDGE
(PRATIBHA RANI)
JUDGE
FEBRUARY 27, 2015/mamta
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